S&P downgrades opinion on risk of Polish banking sector
Standard & Poor’s Ratings Services has downgraded its opinion on the risk of the Polish banking sector to negative from stable, S&P reported on Monday.
Following an analysis of trends connected with the economic risk as well as with the sectoral risk of the Polish banking sector, Standard & Poor's Ratings Services has downgraded its opinion on the risk of the Polish banking sector to negative from stable.
S&P believes that the ability of the Polish private sector to handle the increased cost of debt in foreign currencies "may weaken if the economic outlook and the zloty will be subject to further depreciation".
According to S&P, Polish banks operate in a "challenging" environment and the new bank tax, increased regulatory costs and the potential costs of conversion of foreign currency-denominated loans into Polish zloty will continue to exert further pressure on the profitability of the sector.
S&P believes that these factors reduce the banking sector's ability to absorb losses and to cope with shocks, and may increase risks affecting the stability of the banking sector.
According to the agency, in the coming two years the Polish banking sector will be facing negative trends connected with the economic and sectoral risk. (PAP)
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